Text
The text below is the section as served by the CBIC tax information portal on 17 September 2026, with the portal's own amendment footnote markers (shown as small numerals before a bracket) and its footnotes.[1] The Act as published in the Gazette of India is the legal source.
Section 122, verbatim (show)
Section 122
*Section 122. Penalty for certain offences.-
(1) Where a taxable person who-
(i) supplies any goods or services or both without issue of any invoice or issues an incorrect or false invoice with regard to any such supply;
(ii) issues any invoice or bill without supply of goods or services or both in violation of the provisions of this Act or the rules made thereunder;
(iii) collects any amount as tax but fails to pay the same to the Government beyond a period of three months from the date on which such payment becomes due;
(iv) collects any tax in contravention of the provisions of this Act but fails to pay the same to the Government beyond a period of three months from the date on which such payment becomes due;
(v) fails to deduct the tax in accordance with the provisions of sub-section (1) of section 51, or deducts an amount which is less than the amount required to be deducted under the said sub-section, or where he fails to pay to the Government under sub-section (2) thereof, the amount deducted as tax;
(vi) fails to collect tax in accordance with the provisions of sub-section (1) of section 52, or collects an amount which is less than the amount required to be collected under the said sub-section or where he fails to pay to the Government the amount collected as tax under sub-section (3) of section 52;
(vii) takes or utilises input tax credit without actual receipt of goods or services or both either fully or partially, in contravention of the provisions of this Act or the rules made thereunder;
(viii) fraudulently obtains refund of tax under this Act;
(ix) takes or distributes input tax credit in contravention of section 20, or the rules made thereunder;
(x) falsifies or substitutes financial records or produces fake accounts or documents or furnishes any false information or return with an intention to evade payment of tax due under this Act;
(xi) is liable to be registered under this Act but fails to obtain registration;
(xii) furnishes any false information with regard to registration particulars, either at the time of applying for registration, or subsequently;
(xiii) obstructs or prevents any officer in discharge of his duties under this Act;
(xiv) transports any taxable goods without the cover of documents as may be specified in this behalf;
(xv) suppresses his turnover leading to evasion of tax under this Act;
(xvi) fails to keep, maintain or retain books of account and other documents in accordance with the provisions of this Act or the rules made thereunder;
(xvii) fails to furnish information or documents called for by an officer in accordance with the provisions of this Act or the rules made thereunder or furnishes false information or documents during any proceedings under this Act;
(xviii) supplies, transports or stores any goods which he has reasons to believe are liable to confiscation under this Act;
(xix) issues any invoice or document by using the registration number of another registered person;
(xx) tampers with, or destroys any material evidence or document;
(xxi) disposes off or tampers with any goods that have been detained, seized, or attached under this Act,
he shall be liable to pay a penalty of ten thousand rupees or an amount equivalent to the tax evaded or the tax not deducted under section 51 or short deducted or deducted but not paid to the Government or tax not collected under section 52 or short collected or collected but not paid to the Government or input tax credit availed of or passed on or distributed irregularly, or the refund claimed fraudulently, whichever is higher.
(1A) Any person who retains the benefit of a transaction covered under clauses (i), (ii), (vii) or clause (ix) of sub-section (1) and at whose instance such transaction is conducted, shall be liable to a penalty of an amount equivalent to the tax evaded or input tax credit availed of or passed on.
1[(1B) 2[Any electronic commerce operator, who is liable to collect tax at source under section 52,]—
(i) allows a supply of goods or services or both through it by an unregistered person other than a person exempted from registration by a notification issued under this Act to make such supply;
(ii) allows an inter-State supply of goods or services or both through it by a person who is not eligible to make such inter-State supply; or
(iii) fails to furnish the correct details in the statement to be furnished under sub-section (4) of section 52 of any outward supply of goods effected through it by a person exempted from obtaining registration under this Act,
shall be liable to pay a penalty of ten thousand rupees, or an amount equivalent to the amount of tax involved had such supply been made by a registered person other than a person paying tax under section 10, whichever is higher]
(2) Any registered person who supplies any goods or services or both on which any tax has not been paid or short-paid or erroneously refunded, or where the input tax credit has been wrongly availed or utilised,-
(a) for any reason, other than the reason of fraud or any wilful misstatement or suppression of facts to evade tax, shall be liable to a penalty of ten thousand rupees or ten per cent. of the tax due from such person, whichever is higher;
(b) for reason of fraud or any wilful misstatement or suppression of facts to evade tax, shall be liable to a penalty equal to ten thousand rupees or the tax due from such person, whichever is higher.
(3) Any person who-
(a) aids or abets any of the offences specified in clauses (i) to (xxi) of subsection (1);
(b) acquires possession of, or in any way concerns himself in transporting, removing, depositing, keeping, concealing, supplying, or purchasing or in any other manner deals with any goods which he knows or has reasons to believe are liable to confiscation under this Act or the rules made thereunder;
(c) receives or is in any way concerned with the supply of, or in any other manner deals with any supply of services which he knows or has reasons to believe are in contravention of any provisions of this Act or the rules made thereunder;
(d) fails to appear before the officer of central tax, when issued with a summon for appearance to give evidence or produce a document in an inquiry;
(e) fails to issue invoice in accordance with the provisions of this Act or the rules made thereunder or fails to account for an invoice in his books of account, shall be liable to a penalty which may extend to twenty-five thousand rupees.
*Enforced w.e.f. 1st July, 2017. Inserted (vide Notification No 92/2020- C.T, dated 22-12-2020 by s.126 of The Finance Act, 2020 (No. 12 of 2020) - Brought into force w.e.f. 01st January, 2021.
1. Inserted (w.e.f. 1st October, 2023 vide Notification No. 28/2023 - CT dated 31st july, 2023.) by s. 155 of The Finance Act 2023 (No. 8 of 2023).
2. Substituted (w.e.f. 01.10.2023) by section 144 of The Finance Act (No. 2) Act, 2024 No. 15 of 2024 dated 16.08.2024.
122(1)(i) to (xxi)Listed taxable-person offences
he shall be liable to pay a penalty of ten thousand rupees or an amount equivalent to the tax evadedSection 122(1)(i) to (xxi)
The list covers missing or false invoices, invoices without supply, another person's registration number, collected-tax non-remittance beyond three months, section 51 deduction and section 52 collection failures. It also covers credit without receipt, fraudulent refunds, section 20 breaches, evasion-intended falsification, registration failures or false particulars, officer obstruction, undocumented transport, suppressed turnover and statutory books or information failures. Further offences concern knowingly confiscable goods, evidence interference and detained, seized or attached goods; the higher of ten thousand rupees and the specified linked amount applies, subject to section 75's duplicate-penalty bar. The law does not settle how many separate penalties arise by contravention, document or period.
Questions to answer on the file5 questions
122(1A)Benefit and instance
shall be liable to a penalty of an amount equivalent to the tax evaded or input tax credit availed of or passed on.Section 122(1A)
The person must retain the benefit of a transaction under sub-section (1)(i), (ii), (vii) or (ix), and the transaction must occur at that person's instance. Both conditions qualify this separate measure.
Questions to answer on the file5 questions
122(1B)(i) to (iii)Operator failures
shall be liable to pay a penalty of ten thousand rupees, or an amount equivalent to the amount of tax involvedSection 122(1B)(i) to (iii)
The operator must be liable to collect under section 52 and allow the stated unregistered or ineligible inter-State supply, or misstate exempt registrants' outward goods supplies. The higher measure compares ten thousand rupees with tax assuming a registered non-composition supplier. The law does not settle the stated application question for supplies between 1 October 2023 and 16 August 2024, notwithstanding the retrospectively dated substitution.
Questions to answer on the file7 questions
122(2)(a) and (b)Registered-person defaults
shall be liable to a penalty of ten thousand rupees or ten per cent. of the tax due from such person, whichever is higherSection 122(2)(a) and (b)
That measure concerns defaults for non-fraud reasons. Fraud, wilful misstatement or suppression to evade tax instead uses ten thousand rupees or tax, whichever is higher. Section 75's stated bar on another penalty for the same act or omission qualifies application.
Questions to answer on the file7 questions
122(3)(a) to (e)Other persons and conduct
shall be liable to a penalty which may extend to twenty-five thousand rupees.Section 122(3)(a) to (e)
The list covers aiding sub-section (1) offences, the stated knowing dealings with confiscable goods or contravening services, summons non-appearance and invoice issue or accounting failures. The goods and services limbs retain their knowledge or reason-to-believe conditions.
Questions to answer on the file7 questions
Other questions to answer on the file
Questions a reviewer answers from the engagement file, grouped by the part of the section they come from. They describe what the section asks; they do not decide it.
Scope the section as a whole
Questions to answer on the file2 questions
The taxable person and the date 122(1) opening words
Questions to answer on the file3 questions
Tax collected and not paid 122(1)(iii) and (iv)
Questions to answer on the file5 questions
Deduction and collection at source 122(1)(v) and (vi)
Questions to answer on the file7 questions
Input tax credit and refund 122(1)(vii), (viii) and (ix)
Questions to answer on the file4 questions
Records, information and evidence 122(1)(x), (xvi), (xvii) and (xx)
Questions to answer on the file7 questions
Registration 122(1)(xi) and (xii)
Questions to answer on the file5 questions
Goods, their transport and their custody 122(1)(xiv), (xviii) and (xxi)
Questions to answer on the file4 questions
Obstruction of officers and suppression of turnover 122(1)(xiii) and (xv)
Questions to answer on the file3 questions
The penalty under sub-section (1) 122(1) closing words
Questions to answer on the file6 questions
Frequently asked questions
Does retained benefit alone satisfy sub-section (1A)?
No. The specified transaction must also be conducted at that person's instance. The linked transaction categories are expressly listed.
Section 122(1A)
Are all electronic commerce operators within sub-section (1B)?
Its substituted opening words identify operators liable to collect under section 52. The listed supply or statement failure must also occur.
Section 122(1B)
Can another penalty duplicate the same act already penalised under the determination provisions?
Section 75 supplies the stated bar against another penalty on the same person for the same act or omission. Section 122 is read with that restriction.
Section 122, read with section 75
Amendment history
The CBIC text carries 2 footnotes. The table gives each in the source's own terms. Effective dates are as the footnotes state them.[1]
| Note | Change |
|---|---|
| 1 | Inserted (w.e.f. 1st October, 2023 vide Notification No. 28/2023 - CT dated 31st july, 2023.) by s. 155 of The Finance Act 2023 (No. 8 of 2023).[2][3] |
| 2 | Substituted (w.e.f. 01.10.2023) by section 144 of The Finance Act (No. 2) Act, 2024 No. 15 of 2024 dated 16.08.2024.[4] |
Relationship with other provisions
| Provision | Connection | Words that tie them |
|---|---|---|
| Section 51 | 122(1)(v) requires Section 51 | 122(1)(v) "fails to deduct the tax in accordance with the provisions of sub-section (1) of section 51" |
| Section 52 | 122(1)(vi) requires Section 52 | 122(1)(vi) "fails to collect tax in accordance with the provisions of sub-section (1) of section 52" |
| Section 20 | 122(1)(ix) requires Section 20 | 122(1)(ix) "takes or distributes input tax credit in contravention of section 20, or the rules made thereunder" |
| Section 10 | 122(1B) requires Section 10 | 122(1B) "had such supply been made by a registered person other than a person paying tax under section 10" |
| Section 74 | 122(2) defined by the Explanation to Section 74 | the Explanation to section 74 defines "suppression" for the Act's demand provisions |
| Section 75 | this provision overridden by Section 75 | 75(13) bars a penalty under any other provision for the same act where a penalty is imposed under section 73 or section 74 |
| Section 126 | this provision prescribed by Section 126 | section 126 lays down general disciplines related to penalty |
Circulars and notifications
Circulars and notifications in the CBIC repository that cite this section, newest first, by number, date and subject. A listing here does not say what an instrument decides; read the instrument.
Circulars (9)
| Number | Date | Subject |
|---|---|---|
| Circular No. 254/11/2025-GST | 27 October 2025 | Assigning proper officer under section 74A, section 75(2) and section 122 of the Central Goods and Services Tax Act, 2017 |
| Circular No. 242/36/2024-GST | 31 December 2024 | Clarification on place of supply of Online Services supplied by the suppliers of services to unregistered recipients |
| Circular No. 238/32/2024-GST | 15 October 2024 | Clarification of various doubts related to Section 128A of the CGST Act, 2017. amended by a later instrument |
| Circular No. 224/18/2024-GST | 11 July 2024 | Guidelines for recovery of outstanding dues, in cases wherein first appeal has been disposed of, till Appellate Tribunal comes into operation. |
| Circular No. 211/05/2024-GST | 26 June 2024 | Clarification on time limit under Section 16(4) of CGST Act, 2017 in respect of RCM supplies received from unregistered persons. |
| Circular No. 171/03/2022-GST | 6 July 2022 | Clarification on various issues relating to applicability of demand and penalty provisions under the Central Goods and Services Tax Act, 2017 in respect of transactions involving fake invoices. |
| Circular No. 90/09/2019-GST | 18 February 2019 | Seeks to clarify situations of compliance of rule 46(n) of the CGST Rules, 2017 while issuing invoices in case of inter- State supply. |
| Circular No. 71/45/2018-GST | 26 October 2018 | Clarification on issues pertaining to registration as a casual taxable person & recovery of excess Input Tax Credit distributed by an Input Service distributor |
| Circular No. 41/15/2018-GST | 13 April 2018 | clarifying the procedure for interception of conveyances for inspection of goods in movement, and detention, release and confiscation of such goods and conveyances. |
Notifications (4)
| Number | Date | Subject |
|---|---|---|
| Notification No. 16/2025-Central Tax | 17 September 2025 | Seeks to notify clauses (ii), (iii) of section 121, section 122 to section 124 and section 126 to 134 of Finance Act, 2025 to come into force. |
| Notification No. 12/2024-Central Tax | 10 July 2024 | Seeks to make amendments (Amendment, 2024) to the CGST Rules, 2017. |
| Notification No. 40/2021-Central Tax | 29 December 2021 | Seeks to make amendments (Tenth Amendment, 2021) to the CGST Rules, 2017. |
| Notification No. 16/2019-Central Tax | 29 March 2019 | Seeks to make Second Amendment (2019) to CGST Rules. |
Unsettled questions
The words of section 122 do not answer these questions. Where one decides a matter on the file, the answer depends on the position taken on it.
- Is the penalty under sub-section (1) one penalty for the whole of the conduct examined, or a separate penalty for each contravention, each document or each tax period? The sub-section fixes an amount and says "whichever is higher", but never says how many times it is levied.
- Do the opening words of sub-section (1B), as substituted by section 144 of The Finance (No. 2) Act, 2024 with effect from 01.10.2023, govern a supply made between 1 October 2023 and 16 August 2024, the substitution being expressed to take effect before the Act that made it was passed?
See also
- Section 51 of the CGST Act, 2017: tax deduction at source
- Section 52 of the CGST Act, 2017: collection of tax at source
- Section 20 of the CGST Act, 2017: manner of distribution of credit by Input Service Distributor
- Section 75 of the CGST Act, 2017: general provisions relating to determination of tax
- Section 126 of the CGST Act, 2017: general disciplines related to penalty
References
- Central Board of Indirect Taxes and Customs. "Section 122. Penalty for certain offences". Central Goods and Services Tax Act, 2017, CBIC tax information portal, with amendment footnotes 1 to 2. Retrieved 17 September 2026.
- The Finance Act, 2023. Cited in CBIC footnote 1.
- Notification No. 28/2023-Central Tax, dated 31 July 2023: Seeks to notify the provisions of sections 137 to 162 of the Finance Act, 2023 (8 of 2023). Cited in CBIC footnote 1.
- The Finance Act (No. 2) Act, 2024. Cited in CBIC footnote 2.
External links
- CGST Act, 2017, Section 122 on the CBIC tax information portal